BAE Systems to cut nearly 2,000 UK jobs

Defence contractor deals blow to manufacturing sector after lack of orders for its Eurofighter Typhoon jet

Britain’s biggest defence contractor, BAE Systems, is to cut nearly 2,000 jobs in a significant blow to the UK’s manufacturing sector and the government’s industrial strategy.

The company, which makes the Eurofighter Typhoon jet and Britain’s nuclear submarines, said on Tuesday that up to 1,400 jobs would go at its military aerospace business over the next three years, along with a further 375 in maritime services and 150 at its cyber-intelligence business.

BAE aims to achieve the cuts, which are due to be implemented by 1 January and will affect managers as well as people working on the production line, through voluntary redundancies where possible. It employs 83,100 people worldwide, including 34,600 in the UK.

Its aerospace bases at Warton, where parts for the Typhoon are made and assembled, and Samlesbury in Lancashire, which together employ 10,000 people, will see 750 job losses, twice as many as in 2015. Its other aerospace base, in Brough, east Yorkshire, which makes parts for the Hawk, will see its 900-member workforce almost halved to 500, another severe blow to the region after 500 job losses at the site four years ago.

A further 340 dockyard job cuts are going in Portsmouth as part of an efficiency drive, 245 at the RAF bases at Marham in Norfolk and Leeming in North Yorkshire, and 150 in London, Guildford and at other cyber-intelligence sites. There are to be a further 30 job losses at other UK locations.

It is the first move in a cost-cutting programme led by BAE’s chief executive, Charles Woodburn, following a lack of orders for the Typhoon jet.

Britain’s largest union, Unite, vowed to fight what it called a “devastatingly short-sighted” decision. It had called on the UK government to save jobs prior to BAE’s announcement. The union is considering all options, including industrial action.

The Unite assistant general secretary, Steve Turner, said: “These planned job cuts will not only undermine Britain’s sovereign defence capability, but devastate communities across the UK who rely on these skilled jobs and the hope of a decent future they give to future generations.”

The GMB union told the government to stop dithering and develop a plan to safeguard highly skilled defence jobs.

Ross Murdoch, GMB national officer, said: “The prime minister must step up to the plate and forge trade deals with overseas partner countries, as well as delivering a cast-iron commitment now to build the next-generation fighter planes.”

Speaking in parliament, Claire Perry – minister at the Department for Business, Energy and Industrial Strategy – insisted that BAE’s changes were “not related to any UK defence spending decisions” but a result of internal restructuring and normal business practice.

She said the government was working with BAE to ensure compulsory redundancies were kept to a minimum, and to secure more orders from abroad. “We absolutely understand this is a worrying time for those affected.” She said there were opportunities for BAE workers to get jobs in renewable energy with Siemens in Yorkshire.

Nia Griffith, the shadow defence secretary, said there was “a very real risk that these skills will be lost forever”. She called on the government to come forward with a “proper industrial strategy”.

Woodburn, who became CEO of BAE in July, said the cuts were necessary. “The organisational changes we are announcing today accelerate our evolution to a more streamlined, de-layered organisation, with a sharper competitive edge and a renewed focus on technology,” he said.

“I recognise this will be difficult news for some of our employees and we are committed to do everything we can to support those affected.”

BAE is removing management layers in the UK as part of the restructuring, replacing country-based business units (apart from the US) with three divisions – air, maritime and land – reporting directly to Woodburn. This means the UK will no longer be a standalone division.

Last month Qatar signed a letter of intent to buy 24 Typhoons and six Hawk aircraft from BAE. A potentially large order from Saudi Arabia is still under negotiation. The Typhoon has attracted fewer orders this year than the rival Rafale, built by France’s Dassault Aviation, which has struck deals with Egypt and Qatar.

BAE said: “Negotiations are progressing to agree a contract with the government of Qatar, which, if secured, would sustain Typhoon production jobs and manufacturing well into the next decade.

“However, the timing of future orders is always uncertain and to ensure production continuity and competitive costs between the completion of current contracts and anticipated new orders, we now plan to reduce Typhoon final assembly and Hawk production rates.”

The company also blamed the government’s decision to take the RAF Tornado fleet out of service in 2019, which will affect Marham and Leeming, although BAE will continue to work on the F-35 fighter jet at Marham.

The Ministry of Defence faces a big budget hole after miscalculating the cost of the Trident nuclear programme and the purchase of F-35s from the US.

Unite estimates that by 2020, one-quarter of Britain’s defence spend will be benefiting US companies such as Boeing and Lockheed Martin.

The union is calling on ministers to commit to long-term projects such as the next-generation fighter jet, future support ships and the Royal Navy’s new Type 31e frigate being designed and built in the UK.


Julia Kollewe

The GuardianTramp

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